Background: Population-based data examining the relationship between social participation (SP) and instrumental activities of daily living (IADL) are scarce. This study examined the cross-sectional relationship between SP and IADL in community-dwelling elderly persons. Methods: Self-administered questionnaires were mailed to 23 710 residents aged ≥65 years in Nara, Japan (response rate: 74.2%). Data from 14 956 respondents (6935 males and 8021 females) without dependency in basic activities of daily living (ADL) were analyzed. The number, type, and frequency of participation in social groups (SGs) were used to measure SP. SGs included volunteer groups, sports groups, hobby groups, senior citizens’ clubs, neighborhood community associations, and cultural groups. IADL was evaluated using the Tokyo Metropolitan Institute of Gerontology Index of Competence. Logistic regression models stratified by gender were used. Results: After adjustment for putative confounding factors, including demographics, health status, life-style habits, ADL, depression, cognitive function, social networks, social support, and social roles, participation in various SGs among both genders was inversely associated with poor IADL, showing a significant dose-response relationship between an increasing number of SGs and a lower proportion of those with poor IADL (P for trend <0.001). A significant inverse association between frequent participation and poor IADL was observed for all types of SGs among females, whereas the association was limited to sports groups and senior citizens’ clubs among males. Conclusions: Our results show that participation in a variety of SGs is associated with independent IADL among the community-dwelling elderly, regardless of gender. However, the beneficial effects of frequent participation on IADL may be stronger for females than for males.